Can't find What You Want? Try Google...

Can't find what you want? Try Google

Home Site Contents  

Site Contents for Secrets of International Trade


Contents for: How to Calculate Costing for Export?


"A key tasks of an exporter is to calculate the price that the foreign buyer has to pay for his product..."

"An export costing sheet using the cost plus method of calculation is the best way to quote selling price..."

How to Calculate Costing for Export?
Click here to start on page 1




How to Calculate Costing for Export

Click here to start on page 1

The most usual form of export price quotation is C.I.F. and a named foreign port. This means that the exporter is responsible for paying all costs until the goods arrive at the foreign port.

The price are usually quoted in U.S. dollars.

The foreign importer can then calculate his landed cost for the product by adding to the C.I.F. price quoted, the import duty, local taxes and local transportation costs.

To make the product more attractive to foreign buyer, exporters sometimes quote F.O.B. price and a named foreign port or city. Thus, for example, a Japanese firm may quote F.O.B. Hamburg price to its European customers.

Special International Trade Terms
Actually, these prices are identical with 
C.I.F. prices because all the cost of shipping the goods are paid by the exporter.

The export cost-plus method
of pricing will ensures that you will be selling at a profit.
Export Price Competitiveness and how to calculate export price quotation?
How to do costing in your local currency and convert to foreign currency for export pricing of your products?

Export cost calculation - the exporter may quote F.O.B. Port Klang or F.O.B. KL International Airport, what this means is that the cost of transporting the goods up to the point where the goods are loaded onto the Ship or Airplane and any other service charges are paid by the exporter.

Export credits insurance - The exporter may buy insurance or "Factoring" on its credit sales abroad. Allowance should be made for it.

Total CFR - The total of the previous items, each of which should be rechecked, is the "Cost & Freight" cost of the export goods.

Marine insurance - The exporter will want to insure itself against financial loss from all possible risks, including damage to the goods or theft, while they are being shipped abroad.

Usually, ocean ships are insured for 110% of their total cost to cover anticipated profit and the interest cost of working capital tied up in the shipment.


Total (C.I.F. local funds) - This is the total price of the goods calculated in such a way as to include all the various costs involved, including insurance and freight. It is the total in item 19, plus the insurance premium.

Conversion into Foreign Exchange
The foreign buyer will usually ask for a price quotation in U.S. dollars or perhaps in German marks, Japanese yen, or some other currency. Therefore the exporter's local currency price must be converted into the foreign currency.



Can't find What You Want? Try Google...

Can't find what you want? Try Google